Upgrade of Myanmar and downgrade of Hong Kong
Together with the OECD, the Swedish Export Credits Guarantee Board (EKN) has conducted an overhaul of the country risk categories for countries in Asia. Myanmar has been placed in a lower risk category, and Hong Kong is now higher risk.
Myanmar was upgraded from country risk category 7 to 6
“Reduced vulnerability, increased political stability and low levels of debt are behind the upgrade of Myanmar,” says Johan Dahl, Country analyst at EKN.
The renegotiation of debts to other countries that took place in 2013 were the main factor in reducing the country’s debt level and improved payment statistics.
A reduced dependency on aid and a more diversified economy are also positive developments.
Myanmar has great long-term potential with natural resources, strategic geographical location and young population. Yet the country still has a long way to go as it changes over to democracy and a market economy. Judicial and political institutions must be developed, and skills and experience deficits to government administration and debt matters mean the country’s business environment remains difficult.
EKN’s outstanding guarantees for exports to the country amount to SEK 4 million.
Hong Kong was downgraded to country risk category 2 from 1
“Hong Kong remains strong, and this year sees the 20th anniversary of the ‘one country, two systems’ principle. The reasons for the downgrade include the country’s increased debt levels and more exposure and outstanding claims against China. The slow-down of China’s economy is also having negative consequences for Hong Kong,” says Johan Dahl.
EKN’s outstanding guarantees for exports to the country amount to SEK 801 million.
About the EKN country risk category
EKN monitors developments in the countries of the world and assesses the risk of payment problems. The assessments are summarised in a country policy in which we state the country risk category on a scale of 0 to 7. The lower the number, the better the country's creditworthiness. Assessments are made continuously, as well as in annual regional reviews in collaboration with other OECD countries.